Moore v. New Hampshire Ins. Co., R-W

• Decision Date: 07 April 1982
• Docket Number: Nos. 80-309,R-W,80-310,s. 80-309
• Citation: 444 A.2d 543,122 N.H. 328
• Parties: Julien MOORE,Associates, Inc. et al. v. NEW HAMPSHIRE INSURANCE COMPANY, Aetna Casualty & Surety Company et al.
• Court: New Hampshire Supreme Court

Page 543

444 A.2d 543

122 N.H. 328

Julien MOORE, R-W Associates, Inc. et al. v. NEW HAMPSHIRE INSURANCE COMPANY, Aetna Casualty & Surety Company et al.

Nos. 80-309, 80-310.

Supreme Court of New Hampshire.

April 7, 1982.

Calderwood, Ouellette, Hallisey & Dibble P.A., Dover (Stephen J. Dibble, Dover, on brief and orally), for plaintiff R-W Associates, Inc.

Fisher, Parsons & Moran, Dover (Edward T. Clancy, Dover, on brief and orally), for defendant New Hampshire Ins. Co.

KING, Chief Justice.

The plaintiffs appeal from a decree of the Superior Court (Mullavey, J.) that a garage liability policy issued by New Hampshire Insurance Company to Robert Lambert d/b/a The Stop Shop and Quality Used Cars, Robert Lambert, Wayne Jones, and Julien Moore, A.T.I.M.A. did not cover the plaintiff Julien Moore for any liability arising out of an automobile accident in which he was involved. We reverse.

In July of 1971, Julien Moore, Wayne Jones, and Robert Lambert were members of a partnership known as Stop Shop Sales & Service (Stop Shop) which sold and serviced automobiles. In October of 1971, the partnership contracted with Avis Rent-A-Car to serve as a satellite agency for car rentals.

On February 3, 1971, New Hampshire Insurance Company renewed the above-mentioned garage liability policy effective during the period of March 27, 1971 to March 27, 1973. That policy obligated the insurer to "pay ... all sums which the insured shall become legally obligated to pay because of ... bodily injury ... to which this insurance applies, caused by an occurrence and arising out of garage operations, including only the automobile hazard for which insurance is afforded." The applicable automobile hazard for which insurance was afforded under the policy included "(1) [t]he ownership, maintenance or use ... of any automobile for the purpose of garage operations, and (2) the occasional use for other business purposes and the use for non-business purposes of any automobile owned by or in the charge of the named insured and used principally in garage operations ...." Under this provision, "garage" was defined as "... an automobile sales agency, repair shop, service station, storage garage, a public parking place," and "[g]arage [o]perations [mean] the ownership, maintenance or use of the premises for the purposes of a garage and all operations necessary or incidental thereto."

On August 26, 1972, Julien Moore and Wayne Jones, together with their dates, set out in an Avis rental car from their agency en route to Ogunquit, Maine, ostensibly for the purpose of assisting an Avis customer having difficulty with his rental car. They were unable to locate the customer. They proceeded to enjoy a dinner and an evening dancing in Ogunquit. Early in the morning of August 27, 1971, they left Ogunquit for their return to Portsmouth. While the plaintiff Moore was driving the car through Kittery, Maine, the automobile struck Laura Donnell, a pedestrian.

Nearly four years later, in the superior court of Maine, Donnell sued Moore and General Rental Company, an affiliate of Avis and owner of the vehicle involved in the accident. General Rental Company petitioned for removal of the action to the federal court, and the Maine court granted the petition.

Julien Moore then filed a petition for declaratory judgment against Aetna Casualty & Surety Company pursuant to RSA 491:22 to determine coverage for the accident. Moore subsequently added New Hampshire Insurance Company as a defendant and, in a separate action, sued Richardson-Webb, Inc. (now R-W Associates, Inc.), an insurance agency, and its employee, Leon G. Yeaton, for negligently failing to procure insurance to cover the accident. R-W Associates, Inc. would be liable only if New Hampshire Insurance Company prevailed in its claim that the garage policy did not cover the accident. R-W Associates, Inc. and Leon Yeaton then intervened as parties plaintiff in the declaratory judgment action. Pursuant to agreement of counsel, Julien Moore took a voluntary non-suit against Aetna Casualty & Surety Company.

Trial before the court resulted in certain findings and rulings and a decree that the garage liability policy did not provide coverage. The plaintiffs Moore and R-W Associates, Inc. appealed from this ruling. The plaintiff Moore has neither briefed nor argued the appeal.

Because the automobile hazard clause applicable to the policy expressly states that the non-business use of an automobile in the charge of the named insured and used principally in garage operations is covered, it is irrelevant whether the plaintiff Moore was involved in a business activity when the accident occurred, and the only issues in this case are whether the automobile in question was in the charge of the named insured and whether it was used principally in "garage operations". Two of the three partners operating the Stop Shop, a named insured, were in the car when the accident occurred. In fact, one of the partners was driving. Clearly, therefore, the automobile was in the charge of a named insured.

It is undisputed that the car involved in the accident was an Avis rental car and that the Stop Shop used it principally in the use of its rental operations. Rental operations are not listed among the specified definitions of a "garage" in the policy. Consequently, the ultimate issue in this case is whether the Stop Shop's automobile rental operations are "incidental" to the conduct of its "garage" business.

The plaintiff argues that the trial court erred in finding that the garage...